Simsbury, CT - Board of Finance-Public Hearing-04/01/03

The Public Hearing of the Board of Finance was called to order at 7:30 P.M. in the Auditorium of Simsbury High School. The following members were present: Chairman Paul Henault, Candace Fitzpatrick, Peter Askham, Nicholas Mason, and Kevin North. Also present were Kevin Kane, Finance Director / Treasurer, Tom Vincent, First Selectman, Rich Hogan, Deputy Chairman of Board of Education, Dr. Joseph Townsley, Superintendent, and David Holden, Business Manager and all other interested parties.

Mr. Henault stated that the Board of Finance is an elected Board for the budget process. Their role is to balance expenditures and revenues. It is a task outlined by the State statutes and Town Charter. They hold budget meetings, public hearings, make budget changes, get them approved and submit them at the Town meeting subsequent to the Town referendum and then set the mill rate.

Mr. Henault stated that there are two other important meetings coming up: the Annual Town Meeting on Tuesday, May 6, 2003 at 7:30 in this auditorium and the Referendum on May 20, 2003. He also noted that this year, unlike in past years, there is a court ruling relating to the Board of Education vrs. the Town and Borough of Naugatuck that there will be only one question on the referendum.

Mr. Henault stated that the Board of Finance asked the Board of Education and Board of Selectmen for an increase of no more than 4.25% in their budgets and they accomplished that. The total expenses for next year are $67,892,941 or a 6.19% increase. What drives the 6.19% increase is debt retirement which is the High School modernization project, which was approved by the voters at referendum last year. We will be making bond payment next year. This project is moving along very nicely.

Mr. Vincent introduced members of the Board of Selectmen and said they have put a lot of hard work into this budget process and it was much appreciated.. Mr. Vincent said the Board of Selectmen proposed budget is $14,302,408 which is a 3.99% increase. Their initial budget was higher but with reductions in staffing, positions not funded, part-time help and overtime, medical premiums from union settlements, and initiatives for community projects they were able to reduce the budget. It is now under the 4.25% cap imposed by the Board of Finance.

Mr. Vincent said the Board of Selectmen have four special revenue funds in the 03-04 budget: sewer treatment plant, residential rental properties, dog fund and Simsbury Farms and they also adhere to the spending cap. They are also responsible for capital and non-recurring fund.

Mr. Hogan said the Board of Education is requesting a 2003-04 budget of $47,677,163 or a 4.25% increase. He stated that this includes a 3% increase in teachers salaries, however there were also staff reductions. Other increases were made in maintenance of plant, outside tuition, and insurance and pensions, etc. Mr. Hogan said the per person expenditures is very low compared to other school districts around the State. Four out of five collective bargaining agreements are settled. We were able to get increases in premium co-payments and prescription co-pays. Mr. Hogan said there are a limited number of insurance companies that write municipal coverage these days.

Mr. Henault stated that the tax implications are estimates only. The revenue numbers could still change depending on State funding, investment incomes, and the bond rate of interest on the high school bond.

The estimated current mill rate is 39.1 excluding Fire District Tax and the new mill rate, if no revaluation would be 41.4 - 41.7 excluding First District Tax with the driver being accounting for investment income and bonding methods. Some comparisons were shown on property and motor vehicle taxes. Mr. Henault said at the Town Meeting there would be more examples and a clearer picture of the changes.

Joan Coe, 26 Whitcomb Drive, read a speech about this budget being unacceptable. She feels it is the government's role to provide collectively what one can not obtain individually. She feels that to give non-profit organizations money when the project is not fully funded and to give money to businesses to improve their facilities is not the role of government. Ms. Coe said collection rates are down and the revaluation process is in disarray. She would have to pay a $1000 increase in taxes and doesn’t feel many people can afford to do so.

Ms. Coe said there is a need for a fiscally sound budget and won’t vote for this increase as it needs to be reduced further. She also stated that the Board of Education needs a tighter budget with extra curricular programs being funded by the parents of children in them.

Mr. Vincent said there are tax incentives for businesses. The expansion of existing businesses is over 2.3 million dollars in the last year and when projects are completed they would be getting tax incentives for staying in Town, but those businesses were actually going to move out without the incentives.

Mr. Hogan said the Board of Finance was given a cap of 4.25% and they came within that. Spending on per student basis is 108 out of 169 Towns that doesn’t seem to be a school system that spends too much money.

Mr. Henault spoke on the 1-3 budget referendum question. He said the Committee did not choose to do this, but if they don’t follow we could have a court challenge to the referendum and it could be turned over in court. The Board of Finance role has not changed.

Peter Garwood of 51 Stratton Forest Way had concerns about the authority of the Board of Finance to increase budgets automatically without any opportunity of the Selectman to discuss it or to come forward in public.

Mr. Henault stated the Board of Finance has the option to adjust the budget as presented and they don’t have to send it back before the Public Hearing. The Board of Selectmen then has the authorization to spend money up to that amount without coming back to the Board of Finance.

Mr. Henault stated there are funds available and already in the budget for the Eno project. Mr. Kane said the $300,000 is separate from tonight’s meeting as it is a capital project that went from the Board of Selectmen to the Board of Finance for 1.9 million dollars and which was for additional work which was worthwhile to do in the police station which is what increased the project to 2.3 million dollars. Mr. Kane stated it takes two Boards to approve a project and this will go to referendum on May 20, 2003.

Mr. Kane stated there are Eno funds available - State grants that the Town was given for $200,000, also an Eno trust fund of $70,000 - 80,000, money from surplus funds of about $50,000, capital non-recurring budget of about $35,000, and $175,000 from a 13 year old settlement in the fund today. Also every June the Town receives about $19,000. We have to solve what is done with those proceeds.

Elizabeth Banco of 5 Ryans Circle is the co-chair of the Tourism Committee and spoke about the Visitor’s Center that was cut from the budget. The Committee feels it is a short-sited move to terminate the center which was opened in 1999 and seen about 2500 visitors. It is needed here. The Committee is trying to obtain outside funding, but is also an investment in the Town and would like the Finance Committee to try to find money to save it.

Peter Rosenthal of 10 Farmstead Lane spoke on the academic programs and the level of excellence. He feels programs need to be pushed back to kindergarten and feels there should be more spending on education not less.

Mr. Henault said the process started before November of 2002, looking at economic factors such as the rate of inflation, unemployment rate, cost of living adjustments, fuel costs, etc. The Board reviews the mill rate work spreadsheet and they hold public hearings to discuss revenue and expenses before setting the mill rate projections. The Board of Education is the driving factor on the expense side.

Dave Balboni of 13 Fox Den Road wanted to discuss the Town Charter and bifocated questions on the referendum. He asked if the Town Charter would be violated by changing to one question.

Mr. Henault said our Town Charter did allow for more than one question but so did the Town of Naugatuck and the Court said such a referendum was invalid, which would apply to everyone in the State of CT. Mr. Henault said if we don’t comply we will be in violation of the ruling and our referendum could be challenged in the court.

Joyce Howard of 116 Terrace Lane Road said the Town was doing a great job. She is the co-chair of the Tourism Committee and asked that the Board reconsider taking that out of the budget as it is vital to the Town.

Ken Peterson of 4 Teachers Turn thanked the Board for a fiscally sound budget and asked to what extent is the budget exposed to cut backs from the State. He also would like to know what is the amount of the rainy day fund and what are the contingency plans in the event that the State comes up with less funds than expected.

Mr. Henault stated that the Legislature is still in session, but there are indications of where we will be with funding. Some reductions were factored in, about $80,000. The way the budget process is going we have to take into consideration that we may lose future money. There would be some options - to reduce the budget further, tap into the rainy day fund of 4.2 million dollars, or go back to a special Town meeting for additional funding if necessary.